Reducing Electricity Costs: GOVERNMENT PRESSING AHEAD FOR RENEWABLE ENERGY Public Hears Final Report from CASTALIA Group

As the Government pursues a course towards reducing the cost of electricity, a public consultation was held at the Soroptimists Conference Centre on Tuesday, October 23, on the Anguilla Renewable Energy Integration Project.

The key focus was the presentation of the Final Report and Explanatory Narrative for the project. The consultation was hosted by the Ministry of Infrastructure in collaboration with the Climate and Development Knowledge Network (CDKN), and the Anguilla Renewable Energy Office with the sponsorship of CDKN through the Department for International Development, an agency of the British Government.

The presentation of the Final Report was undertaken by CEO of CASTALIA, David Ehrhardt, who was contracted to work on the project which began in February 2012. CASTALIA is a part of the world-wide CASTALIA Advisory Group with offices in Washington DC and other parts of the globe. The delivery of the report was preceded by addresses by a number of Government and other officials.

Crefton Niles, Director of Public Utilities/Telecommunications Officer, chaired the opening ceremony. He indicated that the Anguilla Renewable Energy Integration Project was aimed at incorporating solar-produced power by persons on the island into the grid of the energy profile of Anguilla“at both the utility scale and the distributed scale.”

Mr Niles continued: “The outcome of this initiative will be a slight reduction in the price of electricity immediately. But it will set the stage where [in the long term] we would see more of a decline in the price of electricity… as we implement the other aspects of the project. We hope that day we will get to the point where we have electricity at a price that is affordable to all.”

Mr. Niles took the opportunity to acknowledge the presence of members of the Clinton Foundation which is associated with the project.

Mrs. Kim Cutler, speaking on behalf of Governor Alistair Harrison, said briefly that the project was “a roadmap to a better economical and more environmental friendly future for Anguilla.” She added: “There will always be glitches, but if you follow the roadmap, eventually you will get there. I think we need to work together…and I look forward to seeing the results.”

Chief Minister, Hubert Hughes, said the Government was taking into account the best interest of the people of Anguilla. “Our people, the economy and the entire island are presently undergoing much stress because of the extremely high price of electricity coupled with the financial and economic situation currently facing the world,” he observed. He stated that the energy renewal project was being financed by Denmark and DFID.

“It is not on many occasions that we have any exercise of this nature financed by the British Government. So we must be very understanding of the very high priority that even Britain has given to helping us to secure affordable energy.” The Chief Minister also cautioned that the use of fossil fuels was resulting in global warming and affecting sea level and creating other environmental problems. “The more we go for renewable energy, it is better for Anguilla.”

He welcomed the participation of the members of the Clinton Foundation in the consultation and said that his Government had committed itself to working towards renewable sources energy to reduce the cost of electricity; and the consultation was to involve the people of Anguilla in the process.

Minister responsible for the Environment, Walcott Richardson, quoted a magazine as having stated that the Anguilla Renewable Energy Project, aimed at making the island energy independent within ten years, was an interesting model for other countries and territories.

“It is no secret that this Government is fully bent on going forward with renewable energy,” the Minister stated. “We are determined to fulfil our pledges as stated in our manifesto. We pledged to make electricity affordable and that is what we intend to do.”

CDKN’s Country Project Manager for Latin America and the Caribbean, Patricia Leon, said her organisation was happy to partner with the Anguilla Government in taking forward the Energy Renewal Project. That having been the case, CDKN had obtained excellent technical advice from CASTALIA. She was happy that the global company had now prepared a final report with recommendations for the Government and people of Anguilla. She looked forward to Government’s implementation of the recommendations in due course.

The Anguilla Renewable Energy Office was instrumental in assisting the Government to move the project forward. Speaking on behalf of AREO, Beth Barry said the project had been on-going for several years and it was wonderful to see the priority it was receiving from Government. She went on to review the work of the organisation and thanked the Climate and Development Knowledge Network for its sponsorship.

Minister of Energy, Evan Gumbs, received the Final Report of CASTALIA on behalf of the Government and people of Anguilla and declared open the public consultation. “One of my most important tasks as Minister of Energy is to ensure universal access to an affordable electricity supply to all Anguillians,” he told his listeners. “Simply put, it is my responsibility to ensure every man, woman, boy, girl and baby, and all visitors to our shores, receive the electricity they need and at a price they can afford.

“I made it a promise to deliver when I got into office. I am pleased to announce today that we are on the verge of delivering on that promise. With the completion and full implementation of this project, we will in time see the promise fulfilled.”

The Final Report, presented by Mr. David Ehrhardt, CASTALIA’s CEO, outlined the scope of work undertaken by his advisory firm. He explained that this included reviewing relevant laws and regulations; assessing renewable energy potential; identifying barriers; recommending ways to improve laws and regulations for overcoming the barriers; preparing an inception, draft, and final report and an explanatory narrative; and preparing a roadmap for implementing the final recommendations.

The report contains four sets of recommendations made to the Government. The first set is as follows: Require solar heaters for new buildings (or at least the necessary wiring and plumbing); Government to make this requirement part of the draft building code, building regulations, or permit process.

Government help for financing solar projects; Government to assist in providing concessional financing so that banks and installers set up a credit-line for solar projects; Government to secure funding from donors; Government to create certifications for installers of renewable energy equipment; Government to create an external certification programme for installers of renewable equipment; and all qualified installers to be certified.

The second set of recommendations: Allow people to sell excess electricity if they have a contract with ANGLEC to do so; Government to amend the Electricity Act; Government to amend ANGLEC’s licence and Electricity Supply Regulations with ‘Rules for Renewable Energy’; ANGLEC to design and implement a pilot, and then revise a Standard Offer Contract in line with Rules for Renewable Energy.

Allow people to buy other services used from ANGLEC; ANGLEC to design and issue a pilot disaggregated tariff now – implement final version after pilot and further research;during the pilot, Government or ANGLEC should commission a Cost of Service Study to determine the cost of each service. Afterwards, the Government should amend the Electricity (Rates and Charges) Regulations with a disaggregated tariff.

The third set of recommendations: The Government should amend ANGLEC’s licence and the Electricity Supply Regulations by adding ‘Rules for Renewable Energy’ to develop, procure, or contract utility scale renewables under ANGLEC’s licence.

Optional changes that ANGLEC should consider are adopting a policy, or else amending its by-laws so that it must follow the ‘Rules for Renewable Energy’.

ANGLEC should procure a solar PV unit following the ‘Rules for Renewable Energy’ by: publishing a request for Expressions of Interest including an operations and maintenance component (even a short one) in the Request for Proposals.

The Government should add more certainty about recovering the cost of renewable energy investments by amending ANGLEC’s licence and the Electricity Supply Regulations with: a definition of ‘Approved Renewable Energy Costs’ (those renewable energy costs that are incurred following the ‘Rules for Renewable Energy’); and add a cost recovery principle for ‘Approved Renewable Energy Costs’ so that the costs can be recovered in people’s bills.

The fourth and final set of recommendations: Further assess wind and waste resources. Government, ANGLEC, or developers should: determine if the quality of wind resources is adequate to generate electricity at reasonable costs, and if there are appropriate sites determine if the quantity and composition of the waste allows for generating electricity at reasonable costs.

Strengthen capacity of Electrical Inspector’s Office. Government should ensure that the Electrical Inspector’s Office is trained to: handle increased inspections of renewable energy installations; and enforce any new technical or safety standards.

Make a decision on the best option to regulate the electricity sector as a whole. Government should decide between using: the Public Utilities Commission; and other options (such as appointing an Electricity Commissioner, or using the Eastern Caribbean Electricity Regulatory Authority).

Observers think that the above recommendations are not only wide-ranging, but highly technical and academic. They will obviously require a lot of understanding, consideration and will, on the part of Government, in the run-up to implementation.